IMT Hyd Newsletter:Empressario Aug12

EMPRESSARIO …an entrepreneurial insight

AUGUST ‘2012 Vol. II Iss. 1

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CONTENTS Prarambh Speaks……………………………………………. .4 Start-up Interview…………………………………………... .5 Cashing in on Crops…………………………………………….. 5

Zany-Ception …whacky ideas that work!!!............7 Innovative Health System……………………………………. 7

Monthly Features……………………………………………. .9 Carpe Diem: INDIA Inc. – flipkart.com…………………. 9 INDIA – the need for research……………………….......11 The Banquo’s Ghost………..………………………………….13

SnapShots…………………………………………………. ……17 Add-ons…………………………………………………….. ……18 Readers’ Corner…………………………………………….……18 Editor’s Quiz/Current News ……………………………….18

Team Prarambh………………………………………...……19

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Prarambh Speaks “Business opportunities are like buses, there’s always another one coming” – Richard Branson

Prarambh comes up with the second issue of newsletter with added features focusing on various aspects of business and more questions related to the business domain in the interview section. This time we have more contributions and additions.

To add more zing to the activities revolving around entrepreneurship, we had Mr. Chandrakiran coming in the campus last month. He is a senior member of TiE, Hyderabad Chapter and a venture capitalist himself. He had enlightened the students about funding and starting up an own venture. A business plan competition, Bizz-Krieg Re-Loaded, was also held at that time where he judged the various business plans and models, presented by the students, and also gave his feedback and tips to focus on.

We are also having an editorial board in place along with a technical team for the monthly release of the newsletter promising both quality and the feel good effect.

We seek your well wishes and feedback to make this more attractive and addictive

Team Prarambh

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Start-up Interview Cashing in on Crops Kunal Prasad, Founder Director & COO-CropEx Technology Solutions Pvt Ltd (Contributed by our reader, Avinash Kumar Singh) PRARAMBH(P): Tell us something about yourself, your company and your team?

KUNAL(K): I am a first generation entrepreneur with a strong belief that technology is one strong medium which can break the urban and rural divide and bring prosperity in rural India. To make this belief true, we started our company targeting the agriculture-sector.

The vision was to integrate the agriculture-sector with state of art Mobile Cloud technology and make every farm traceable, an area which was never expensively ventured before but always showed great potential for such technology.

Our team was small but the vision was big. We had the right balance and expertise to ensure every vertical i.e.

Technology, Business development, Finance, Operations, etc was properly taken care of. We started off with 3 individuals and as the business progressed we kept adding individuals to bring growth and sustainability to it.

P: When and how did you decide to invest in this field and what was your starting investment?

K: The initial investment came from our personal savings but soon we were supported by family and friends who had a firm belief in us and our vision. The amount was good enough to support us through our initial phase of product and business development. As things started taking shape and we started getting traction from the market, we raised our first seed investment by a venture capital firm. This was the time we started growing exponentially.

P: What makes you stand out from others?

K: My exposure and the learning from past experiences.

The team should be like a strong family with each member complementing one another

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P: What is the toughest feedback that you have ever received and how did you learn from it?

K: A start-up has to continuously derive feedbacks from the market and take actions accordingly. For us, the biggest feedback was that the initial model on which we had bet did not deliver results as expected. We immediately took a decision and tweaked the model. The second model was accepted well in the market and became the star product for the organization.

P: As an employer, what do you look in a prospective employee?

K: The foremost priority is the attitude of the person and the level up to which he can synergize with the team. Start-ups with less number of team members as a constraint cannot afford to have any misunderstanding within the team. “The team should be like a strong family with each member complementing one another.” The team should be self-serving.

If a person fits into the above requirements, then only he is considered as an eligible candidate. His further qualifications would depend on his knowledge and skills and the roll fitment as per the needs of the organization.

P: When have you been most satisfied in your career?

K: The quest for achieving more is a human tendency and satisfaction never comes at the initial stages of one’s career.

I still strive to achieve that level of satisfaction to answer this question appropriately.

P: What positive change do you think your business can bring in the society?

K: Our technology is aimed at creating a sustainable world class model for agriculture in India and abroad. With the widespread implementation of our technology by agribusinesses, governments, cooperatives and NGO’s, we would be able to produce world class products conforming to the international standards and ensure safe food for end consumers.

The quantitative benefits could be observed as increased productivity, better quality of agricultural products and increased income level of farming households which ensures improved standard of living in Rural India.

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Zany-Ception …whacky ideas that work!!!

Innovative Health System – Business of saving lives Social Entrepreneurship (Contributed by Kashif Kalim. The idea is currently being pursued by him)

If anyone of us meets with an accident or is sick then what do we do? Rather the question that needs to be asked is what can we do? The answer can be 1.

2.

In case of normal illnesses, we consult the doctor, buy the prescribed medicine from chemist, and do the regular course of treatment, or We take an appointment from a doctor or directly visit the hospital in case of emergencies.

But in case of an accident or a major illness, the situation becomes more complex. Suppose someone meets with an accident or has a heart attack, then first, someone will be present there to take him to the hospital. Secondly, he will be admitted and formalities for the same will be completed and lastly, the relative or next to kin of the patient will try arrange for an insurance coverage by running from pillar to post. He/she might get completely exhausted and frustrated in course of performing all such formalities.

But imagine today's busy life. Most of the time, we dont get time to buy our medicine or we have to rely on someone else, or it might even happen that we forget to buy medicine at all.

In that case, how do we ensure that we complete our medical requirements? How do we ensure that there is no compromise on taking care of our health, while making the best use of whatever resources we have? There might be a possible solution.

Proposed innovation- Innovative Health System business model cum health service Just imagine what if all these services we talked about are provided to us for free or just at nominal rates. The services like: • • • • • •

Getting an appointment with a doctor.

Delivery of medicines directly at home.

Reminders to take medicine at prescribed time through SMS or call.

Quick arrangement of an ambulance, in case of emergencies.

Hassle free reimbursement of health insurance.

Quick appointment with specialists.

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• •

Opportunity to interact with peer/fellow patient suffering from same disease.

Services of caretakers for people without anyone to take care of them.

We are planning to come up with an organization where a person can get all the above mentioned services by just becoming member of our organization. The membership fees would be nominal and it will be for a year i.e. membership will be on annual basis. After becoming member, the person can avail all these services along with some added features like he/she can choose his/her health insurance according to his/her choice and without any hidden costs or conditions. We will just facilitate the services and the person will get the insurance benefits. Rest of the formalities will be done by us. We can broaden our scope of operations of the organisation by charging the insurance companies, chemists/druggists, the hospital for providing them permanent clients and we would also ensure customer loyalty too.

In this model, a patient will have an opportunity to interact with his peers/fellow patient, health care workers, etc. too. All other stakeholders in the model will be able to interact with each other regarding the particular patient. So, it will be a patient-centric model, where in the patient would be the centre of all the activity. By this, we will ensure that the patient and his/her health becomes the important aspect of the healthcare industry, rather the cost of providing the healthcare itself becoming the focal point of the industry and stakeholders.

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Monthly Features Carpe Diem: INDIA Inc. – flipkart.com From a bold plunge into the uncharted waters of online shopping sector of India, with an initial investment of 4 lac rupees, to become $100 million revenue generating online retail giant in just 5 years, the rise of Flipkart is no less than a fairy-tale.

(Contributed by Sudip Brahmachary)

The Beginning: With an initial investment of 4 lacs, Sachin and Binny Bansal, colleagues from IIT Delhi, thought of doing something in India that nobody had introduced yet. As an obvious follow up of the concept, both of them resigned from their jobs in Amazon.com and formed Flipkart. A decision that germinated the seed-company worth 4 lacs to a company now worth $100 million, and also placed Sachin and Binny Bansal in the Ivy league of most successful and innovative entrepreneurs.

Flipkart is the largest online book store in India, with over 11.5 million book titles available. Currently, Flipkart has registered sales of nearly 2.5 million items across all categories, and sells more than 30000 units per day, or 14 items per minute. The secrets behind Flipkart’s success are the vast titles available for the customer to choose from, exceptionally swift delivery system, hassle-free customer friendly payment option, and an invigorating urge to seek newer horizons. These factors sky-rocketed the growth of Flipkart!

However, it was not all smooth sailing for Flipkart, right from the setting up of bank accounts, to online payment option, to convincing publishers to share their inventory. In the initial days, it was difficult for Flipkart to generate supplier confidence, and the inability to keep a large inventory was an issue. Ensuring the timely delivery of products was another challenge. There was a time when the Bansal duo would even pick up, pack, and deliver the orders themselves. Initially they didn’t have any marketing budget. But as they were confident about their model, they continued to focus on delivering a positive customer experience at all stages, and this in turn turned into a strong word-of-mouth promotion.

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The Customer is the king: Indian companies still lack the culture of ‘customer delight’. Most of them make do with the bare minimum requirements, and do not stretch themselves to provide a truly world-class experience. Indian entrepreneurs, who walk that extra mile to ensure that the customer is delighted with their product and services, are the ones who survive and succeed. In this hyper-competitive environment, Flipkart has tried to own the entire customer experience in the online shopping cycle. The obsession with consumer-delight became the USP of Flipkart, and the numbers speak for themselves. Today, Flipkart has a registered user base of 2 million people, 12 categories, ships 30000 items a day, and earns a revenue to the tune of Rs.2.5 crores a day. All this was made possible because they believed in their vision and worked towards making it a success.

The Future: Today, India is at the cusp of an economic revolution. In this phase, if Flipkart makes the right choices, they can enter an upward growth spiral that will make it one of the largest economic powerhouses in the world. India has a lot of going for it- whether it is size of the growing middle class, high quality of talent, or the advantages of functioning within the largest democracy in the world.

India has already seen remarkable success stories across the retail, healthcare, and education domains, and many more industries will be seen coming into their own in the next few years.

The internet economy, where Flipkart operates, has been growing in leaps and bounds and this is expected to continue in the years to come.

This growth trend is driving more and more professionals and industrial bodies to come together to encourage entrepreneurship. Extensive investments are being made in various business ecosystems by both the government and the private players. This speaks well of the Indian market.

As Sachin Bansal quotes:

“Though we were both in secure jobs, we felt that our learning curves would be far greater if we could do something on our own- something that was tailor-made for the Indian consumer and could make a difference to their lives. Our initial plan was to start a comparison shopping site. However, our initial market research revealed that there were not too many sites to choose from in India. When we realised the potential that lay in this unmet demand-supply gap, Flipkart was born!”

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INDIA – the need for research (Contributed by Rohit Seth) Languishing at yet another bottom of the pyramid, India is ranked 119th in the world for the significance of the research papers published by its top Institutes, according to the Science Citation Index. This acute lack of research is essentially because of the lack of funds available. The annual research budget of USA and China is US$250 and US$60 billion respectively compared to India’s special US$1 billion “Inclusive Innovation Fund” announcement this year. According to OECD data, India has a mere 119 researchers per million of its population, compared to 1,564 in China, 2,706 in the UK, 4,605 in the US and 6,807 in Iceland. Even in terms of the number of researchers per 1,000 people employed personnel, India, with 24 researchers, ranks below China (115), Japan (131), the European Union (231) and the US (324).

In the World Universities Ranking by Thomson Reuters and Times Higher Education, the only Indian University to feature in the top 400 is IIT Bombay on the 317th place(which is outside the top 50 for engineering and Technology). To be fair to them, their annual research budget is 100 times lesser than that of MIT.

The implications of this grim scenario on Business are serious. Status Quo and the World may no longer be flat. If the constant need for up-gradation is not met, then apart from the established Businesses losing share to their global counterparts, the new Entrepreneurs will find it harder to absorb the cost of foreign technology against the opportunity cost of the underdeveloped indigenous ones. In the short run, it seems cheaper to outsource technology from the recession affected west and fundamentally inexpensive China than establishing fully functioning active R&D divisions in Universities, Government owned Facilities and Small Businesses. But this increases the foreign dependence of the nation. With the economic improvement of the western world in the long run, there will be a restoration of bargaining

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power and this will also lead to worsening of balance of payment deficits. India is already the largest importer of Defence Equipment.

The only respite is the interest shown by the MNCs to innovate, reflected in the substantial increase in the FDI inflow for R&D which was US$4 billion in 2010. The number of research divisions has gone upto 750 from 40 in the last decade. Companies like Yahoo have started offering five times the salary to a research scholar than what IITs and IISC offer. HP Labs is offering Doctoral programs in collaboration with BITS Pilani for its R&D scholars.

Initiatives like the development of Swach Water Filter by Tata Chemicals in collaboration with MIT, which is 50% more cost effective than its nearest rival, need to be replicated far more frequently.

But the Government needs to pull up its socks if the country wants to become a selfsustainable economy and strive towards achieving Dr. APJ Abdul Kalam’s vision 2020.

There is a need to develop The ‘Research Culture’ to increase the number of the ‘Master’ minds that move up to the PHD level and who can add to the Intellectual Capital of the country.

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The Banquo’s Ghost (Contributed by our reader, Sudhanshu Agrawal) On July 31, Asia’s third largest economy was hit by a massive power outage in 3 major power grids covering north, east and north-eastern regions. 700 million i.e. 10% of the world’s population was under the darkness (without power) for two days. Stationary trains on the tracks, traffic lights failed resulting in massive traffic congestion, hospitals were forced to use emergency power generators, and miners trapped underground and so on causing complete paralyses of the major cities. It was the largest blackout in the history of the world after Paraguay, Brazil in November 2009.

However, the reason for power failure in Brazil was the nature’s plight - a heavy storm, while India suffered from intractable problems like crippling power shortage, inadequate infrastructure, inefficient government, theft, lack of adequate funds and the list goes on. On the contrary, Mr. Narendra Modi, the chief minister of Gujarat was praised by the nation for making Gujarat a power surplus state. The southern states are also relatively well off.

There is a major demand-supply gap which actually worsens during the summers. The consumption is highest in the morning and evening hours. It thus leads to putting a lot of pressure on the power grids. Sources of electricity like KG basin fields of Reliance Industries have very low generation capacity. Also, Coal India, a monopoly generates 60% of the electricity, has a stagnant output generation due to the issues within the policy makers on land acquisition and clearances from the environmental bodies. The government has failed to come up with appropriate policies for the same. The coalition government is often criticized for its stewardship of the wobbling economy again has nothing to say on what caused the failure.

So . . . how is the capacity going to increase?

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There are multiple reasons behind this issue and also there are many measures for the same.

However, I want to talk about a technology which I feel might be a solution to the never ending plight of the Indians in getting rid of the power cuts (perennial) which is our Banquo’s Ghost (metaphorically).

This technology is going to change the world ‘Bloom energy’, a start up in California has come with an invention, Bloom Box, in order to replace big power plants and generate electricity in an easiest possible and in an eco-friendly way. K.R. Sridhar is the mind behind the project. He started the company in 2002 having headquarters in Silicon Valley, California, USA. The bloom box is a solid oxide fuel cell that can use a wide variety of inputs to generate electricity on the site where it is used. It is highly efficient, low cost and has low polluting emissions.

Sridhar credited his nine-year-old son for the name, saying that his son believed jobs, lives, environment and children would bloom. Bloom stated that two hundred servers have been deployed in California for a number of corporations like eBay, Google, Wal-Mart and many more (Wikipedia).

Your own electricity can be generated in your backyard and it will be wireless. This technology was originally created by NASA by Sridhar (rocket scientist) himself in order to produce oxygen on Mars. After the mission was scrapped, he reversed the machine and converted it from oxygen producer to electricity generator by feeding it oxygen on one side and fuel on the other which creates electricity without combustion or burning. The energy thus created is cleaner, more efficient than oil, gas and coal and more reliable than wind and solar energy.

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(Courtesy: www.bloomenergy.com)

“This technology is going to change the world”, says Sridhar in an interview to Time magazine.

Prospects in India We have centralized generation of energy which is capital intensive, leaves a large footprint of Carbon dioxide, the capacity is constrained, aging infrastructure and their transmission loss of around 10-40%. The energy solution would be distributed energy which means just like desktops were replaced by laptops, landlines were replaced mobiles. Similarly the power generation houses are replaced by bloom boxes. Its implications are that it is low cost, high efficiency, fuel flexibility, generation and storage. Bloom box provides a personal gas station for tomorrow’s hybrid, electric or hydrogen vehicles. Coca-cola, FedEx, Bank of America, eBay, Wal-Mart and Google are already its customers. Its success is yet to be measured as the company is not very old and its use has just begun.

We are not sure when will this technology come to India but I hope it comes soon considering the inability of the system to fight this Banquo’s Ghost. The recent blackout has also affected India’s image as a major emerging economy. We need to supply enough power to meet the demand which outpaced supply by 10.2 percent. Bloom box technology, if successful, on entering India, is going to solve the major electricity issues in the country and also overcome the government’s dysfunction. It could be a distributed-energy industry -

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letting third world countries and villages produce their own power instead of relying on some inefficient centralized power. Initially price of the technology would be very high as the supply would be very less and demand would be very high, but when the price would come down to the level that every villager in the country can afford it, ‘power to the people’ (Marxism) will have real meaning and the real democracy would then come into the picture which is distributive and not centralized (Capitalism), thereby getting rid of ‘The Banquo’s Ghost’.

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SnapShots The B-Plan event, Bizz-Krieg Reloaded was held on 21st July, 2012 and was judged by Mr. Chandrakiran, senior member of TiE, Hyderabad Chapter and a venture capitalist. At the end of the event, he shared some tips and nuances on designing a B-plan 1 and entrepreneurship.

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1. A group explaining their business plan regarding waste disposal management.

2. Enthusiastic students with faculty members and Mr. Chandrakiran in the first row.

3. A group explaining their business plan regarding a network of spare parts suppliers to manufacturing industry.

4. Another group explaining their business plan on providing health drinks to masses.

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Add-ons Readers’ Corner Got any comments? Would you like to contribute to the newsletter? Get back to us at: ecellprarambh@gmail.com.

Your comments/views and articles would be published from the next issue. A few things to be kept in mind: • • •

Articles/comments should not be demeaning / damaging in nature.

Articles should be to the point and of around 500 words.

The decision of selecting the articles to be featured and the number of such articles rests with the faculty mentor and editor of the newsletter.

So put on your thinking caps and show us your intellect side.

Editor’s Quiz/Current News Every month, to keep you informed with the past and current happenings in the business world, we would start this column very soon.

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Team Prarambh

Faculty Mentor Dr. Archana Pillai Core Members: Arjun Chaudhuri Udit Luthur Divya Vuppala Vaibhav Chabra Manish Vishnu M. Designing, Compiling & Tech support: Prateek Mukherji Pankaj Gaurav Editing team: Anshika Rai Ridhima Kumar Harsh Kapadia Ameya Lingaraju Contributed by: Sudip Brahmachary Rohit Seth Kashif Kalim Readers’ Contributions: Avinash Kr. Singh Sudhanshu Agrawal

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Write to us: ecellprarambh@gmail.com OR Follow us at:

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Institute of Management Technology, Hyderabad Survey No. 38, Cherlaguda Village Shamshabad Mandal, RR District, Hyderabad-501 218 (A.P.) Tel: +91-40-30461650-53 Email: info@imthyderabad.edu.in

Fax: +91-40-30461654

Website: http://www.imthyderbad.edu.in

Vol. II Iss. 1 | Empressario | August 2012 | Prarambh |

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